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Cracker Barrel (CBRL) to Post Q3 Earnings: What's in Store?

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Cracker Barrel Old Country Store, Inc. (CBRL - Free Report) is scheduled to report third-quarter fiscal 2021 results on May 25. In the last reported quarter, the company’s earnings beat the Zacks Consensus Estimate by 9.4%.

Q3 Estimates

The Zacks Consensus Estimate for the third-quarter bottom line is pegged at 7 cents. In the year-ago quarter, the company had reported adjusted loss of $6.81 per share. The consensus mark for revenues stands at $658.4 million, suggesting growth of 52.2% from the prior-year quarter.

Factors to Note

Cracker Barrel’s fiscal third-quarter performance is likely to have benefited from robust off-premise sales, sales building efforts and expansion efforts. Additionally, the company has been focused on rejuvenating its menu, which is crucial to growth. Moreover, improvement in sales and operating margin on the back of stimulus spending, pent-up demand, continued vaccinations and a lower COVID-19 caseload might have contributed to the performance. Additional investment and ramp-up expenses associated with the continued rollout of key initiatives such as beer & wine, digital enhancements and menu innovation also bode well.

Moreover, the Zacks Consensus Estimate for Restaurant revenues is pegged at $540 million, suggesting growth of 51.7% from the yeat-ago quarter. Meanwhile, the consensus mark for retail revenues stands at $119 million, indicating an improvement of 65.3% from the year-ago quarter.

However, dismal traffic due to the pandemic is likely to have weighed on the results. In the first and the second quarter of fiscal 2021, comparable store restaurant sales comprised traffic decline of 18.3% and 24.2%, respectively.

What the Zacks Model Unveils

Our proven model does not conclusively predict an earnings beat for Cracker Barrel this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Cracker Barrel has an Earnings ESP of 0.00% and a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Peer Releases

Yum! Brands, Inc. (YUM - Free Report) reported strong first-quarter 2021 results, with earnings and revenues surpassing the Zacks Consensus Estimate. The metrics increased year over year. The company’s adjusted earnings of $1.07 beat the Zacks Consensus Estimate of 85 cents. In the prior-year quarter, the company had reported adjusted earnings of 64 cents. Quarterly revenues of $1,486 million surpassed the consensus estimate of $1,461 million. The top line also rose 17.7% year over year. The upside can be attributed to increase in sales along with rise in franchise and property revenues.

McDonald's Corporation (MCD - Free Report) reported first-quarter 2021 results, with earnings and revenues outpacing the Zacks Consensus Estimate. The company reported adjusted earnings of $1.92 per share, which surpassed the Zacks Consensus Estimate of $1.81. Moreover, the bottom line rose 31% year over year. Quarterly revenues of $5,124.6 million beat the Zacks Consensus Estimate of $5,047 million. Moreover, the figure rose 9% year over year. The top line benefited from increase in global comparable sales.

Starbucks Corporation (SBUX - Free Report) reported second-quarter fiscal 2021 results, with earnings beating the Zacks Consensus Estimate and revenues missing the same. The company reported adjusted EPS of 62 cents, which beat the Zacks Consensus Estimate of 52 cents. In the prior-year quarter, the company had reported adjusted EPS of 32 cents. Meanwhile, quarterly revenues of $6,668 million missed the Zacks Consensus Estimate of $6,803 million. However, the top line increased 11.2% from the year-ago quarter’s levels. The uptick was driven by growth in comparable store sales, partially offset by the unfavorable impact of Global Coffee Alliance transition-related activities.

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